The company responded to the price query saying it was not aware of any information concerning it that has not been announced to the market which, if known by some in the market could explain the recent price movement.

It did, however, note a number of potential reasons for the recent price move being i) a recent research report, ii) offtake agreements, and iii) mining licence updates.

On Friday 19 January 2019, the company released a commissioned report prepared by Orior Capital via email and via its website.

The company noted the report “was part of our financing strategy and post the release of our stunning definitive feasibility study, Orior Capital was commissioned by Black Rock Mining to undertake a review of the business and graphite sector.”

Mining licence status upgraded from submitted to recommended

The licence status was upgraded from submitted to recommended on 10 January 2019.

Tanzanian authorities have commenced routine processing and approval of new and renewal of mining licences including those submitted by Australian mining companies.

Black Rock understands there are meetings scheduled this week in Tanzania where new mining licences may be issued, which may or may not include Black Rock’s application.

]]>Tue, 22 Jan 2019 09:07:00 +1100MinRex Resources prepares for next phase of gold exploration in the East Pilbarahttps://www.proactiveinvestors.com.au/companies/news/212988/minrex-resources-prepares-for-next-phase-of-gold-exploration-in-the-east-pilbara-212988.html
https://www.proactiveinvestors.com.au/companies/news/212988/minrex-resources-prepares-for-next-phase-of-gold-exploration-in-the-east-pilbara-212988.htmlMinRex Resources Ltd (ASX:MRR) is preparing for the next phase of fieldwork in WA's East Pilbara, including exploration at all four of its gold project areas around Marble Bar - Daltons, Bamboo Creek, Marble Bar North and Marble Bar South.

During the December 2018 quarter, extensive metal detecting was completed on all four East Pilbara project areas.

Marble Bar North

Five small gold nuggets totalling 1.5 grams in weight were recovered at the Marble Bar North project area, along with gold-bearing quartz rocks.

Two quartz rock specimens were also collected, which activated the metal detector, and upon close examination were seen to contain small particles of gold on their surfaces.

Mapping in this area also uncovered a layered, fine-grained basal gravel deposit under a surficial coarse-grained quartz scree deposit.

Basal gold-bearing gravel layer

During 2019, the next phase of fieldwork in the East Pilbara will include further rock sampling, soil sampling and detailed geological mapping.

This will be used to better understand these complex gold, base metal and polymetallic mineralised systems.

The company said in October 2018 the Solo product had been successfully launched commercially in tandem with Samsung and demonstrated to South-East Asian, Australian and New Zealand markets.

The workforce safety app product was first showcased in September 2018.

The company said in November: “Vault believes with the increased momentum in V3 sales and opportunities, anticipated sales from CV3 in China, launch of the global digital sales platform and revenue from Solo sales that the original forecast of $6 million CARR for financial year 2018-19 is achievable with strong quarters anticipated in (the) March and June quarters.”

Vault reported at the time that it was funded, had a strong balance sheet and was resourced to deliver sales revenue from its pipeline.

In the September 2018 quarter, the company increased total cash receipts by 10%, on the previous record quarter, to $1.12 million.

The gain was a 14% increase on the September 2017 quarter result.

Vault’s CARR came solely from its Vault Enterprise (V3) sales and was $402,000.

The company tipped revenues for the product in the December 2018 quarter, saying in the September quarterly: “Solo is now being trialled with sales expected in the upcoming quarter from a significant sales pipeline.”

“The really cool thing about it is that we’re very strong in the belief that we need to be able to manage and protect our workers out there and certainly Solo does that and plus.

“The big plus is that we also give some great productivity tools on the end of that complement and give a nice return on investment back to our people that are purchasing.

“We’re very excited about the demand, demand has been through the roof and the capital raise is certainly going to assist us now to really get behind some of those areas that we’d love to expand on; in terms of capability, but also to accelerate our growth and our penetration in the marketplace.”

Melbourne and Christchurch-based Vault was boosted in the September and December 2018 quarters with $5 million of funds from high-quality investors keen to see the company advance its pipeline.

Vault said the subscriptions from institutional and sophisticated investors were a sign of support for the company which planned to use the funds towards its roll-out of is Vault Solo on the Samsung Galaxy Watch.

A demonstration launch of the Samsung Solo watch app launch took place in New Zealand on September 6, 2018, at a government showcase attended by the former New Zealand company now headquartered in Australia.

The subsequent commercial rollout of the product in October 2018 will mean first revenues from the various international markets — South-East Asia, Australia and New Zealand — will be reflected in cash receipts for the company’s upcoming December 2018 quarter activities report.

September 2018 quarter revenues

Vault broke through a ceiling in the September 2018 financial quarter, having its first quarter of takings of more than $1 million.

Vault reported in the September quarterly report published on October 31: “This is a good result and will be further strengthened in the upcoming quarter with CARR being generated from Vault Solo sales.

“In conjunction with Samsung's new Galaxy wearable range, Vault Solo was successfully launched in the first week of October.

“Two customer systems have already been implemented and more than 30 customer trials are underway across Asia, Australia and New Zealand.”

The trials last for a minimum of four weeks, so the company was expecting sign-ups from November 2018, at least a month on from its October 4 commercial release.

The company wrote: “The successful trial and deployment of Vault Solo across the current client base and potential new large customers is expected to accelerate in financial year 2019 and provide continued strong growth in CARR.”

Vault’s cash holding was $5.4 million at the end of the September quarter after the company spent $706,000 on operating activities and $335,000 on investing activities.

It had drawn down $131,000 of $321,000 in loan facilities.

Vault tipped it would spend $2.1 million in December 2018 quarter and forecast no asset disposals.

Peninsula’s managing director Richard Henning said: “We continue to be encouraged by the high-grade intercepts from the Gapyeong graphitic unit and will now do further metallurgical testing prior to further resource drilling.

“The objective is to define a maiden flake-graphite mineral resource in South Korea.

“It should be noted that due to the winter season in Korea, ground conditions are such that further groundwork is unlikely until spring.”

Peninsula has also received additional analyses from a recent diamond hole with a new intersection of 4.15 metres at 5.1% TGC in addition to the previous intercept of 6.55 metres at 7.9%, including 2.47 metres at 11.9%.

The latest trench results indicate that the grade of the Gapyeong graphitic unit may be higher to the south of the current drilling.

Large flakes identified

Petrographic work on the Gapyeong drill-core has identified large flakes with interstitial and associated sulphides.

The presence of strong sulphide mineralisation was not evident in previous channel sampling and was most likely oxidised and leached at surface.

Metallurgical tests

Further metallurgical testing has been initiated on fresh-rock drilling samples to confirm that TGC concentrate in excess of 95% can be generated from the sulphide-bearing graphitic material.

The objective would be to reach a 99.95% TGC purity spherical graphite product to meet the specifications of South Korean lithium-ion battery anode manufacturers.

Peninsula recently signed an MOU with South Korean high-technology manufacturing company Tera Technos Co Ltd that specialises in the production of high-performance carbon composite ‘SiOx’ anode materials, a modified and enhanced version of spherical graphite.

Photomicrograph of the carbon composite anode materials produced by Tera Technos.

The MOU includes an initial testing program by Tera Technos to complete spheroidisation and electrochemical test work on graphite concentrate samples from the Gapyeong project.

]]>Mon, 21 Jan 2019 15:24:00 +1100Adveritas signs a deal to expand its ad fraud prevention software into Chinahttps://www.proactiveinvestors.com.au/companies/news/212923/adveritas-signs-a-deal-to-expand-its-ad-fraud-prevention-software-into-china-212923.html
https://www.proactiveinvestors.com.au/companies/news/212923/adveritas-signs-a-deal-to-expand-its-ad-fraud-prevention-software-into-china-212923.htmlAdveritas Ltd (ASX:AV1) has entered into a deal with Chinese digital marketing consultancy, SparkX, which will use Adveritas’ TrafficGuard software to protect its clients from ad fraud.

Adveritas chief executive officer Mathew Ratty said: “Digital advertising in China is significantly more complex than other parts of the Asia Pacific region (APAC) largely due to the vastly different, closed internet ecosystem and the ways in which consumers engage with digital media.

“By entering the market through a strategic partnership with SparkX, we navigate these complexities to take advantage of the large and growing Chinese advertising market.”

In comparison to the US where a majority of TrafficGuard’s incumbent competitors are based, Australia enjoys much more favourable trade and business relations with China.

Political barriers to entry into China are expected to deter some of TrafficGuard’s competitors.

China’s digital advertising spend is the second fastest growing globally, having increased by 22% in 2017. Countries in APAC make up 5 of the top 10 highest growth markets.

Messina also speaks more broadly about global markets and the favourable operating environment the company has experienced in Canada.

He says, "We'll be getting production on board in Q2. We'll also simultaneously be panning to drill new wells. We'll be getting Wizard lake into high commercial volumes very quickly, and we certainly look forward to our shareholders having a very strong 2019 with us as we embark on developing this exciting field."

]]>Mon, 21 Jan 2019 14:56:00 +1100Bulls, Bears & Brokers: M&A activity in gold sector set to continue, says Bosiohttps://www.proactiveinvestors.com.au/companies/stocktube/11908/bulls-bears--brokers-ma-activity-in-gold-sector-set-to-continue-says-bosio-11908.html
https://www.proactiveinvestors.com.au/companies/stocktube/11908/bulls-bears--brokers-ma-activity-in-gold-sector-set-to-continue-says-bosio-11908.html
Davide Bosio, managing director, CEO & head of corporate finance at DJ Carmichael, tells Proactive Investors that the flurry of M&A activity in the gold sector, in Australia and around the world, is set to continue as global political uncertainty drags on.

To hear Bosio's insights watch our full video interview.

]]>Mon, 21 Jan 2019 13:42:00 +1100Core Lithium achieves a major milestone towards production at Finniss Lithium Projecthttps://www.proactiveinvestors.com.au/companies/news/212920/core-lithium-achieves-a-major-milestone-towards-production-at-finniss-lithium-project-212920.html
https://www.proactiveinvestors.com.au/companies/news/212920/core-lithium-achieves-a-major-milestone-towards-production-at-finniss-lithium-project-212920.htmlCore Lithium Ltd (ASX:CXO) has been granted a mineral lease for the Grants Deposit, a key component of its fully owned Finniss Lithium Project near Darwin in the Northern Territory.

The company has received and accepted the notification from Northern Territory Assistant Minister for Primary Industry and Resources, Nicole Manison, advising Core of the NT Government’s offer of a mineral lease for a term of 20 years.

The award of the mineral lease is both a historic and momentous one for Core, the NT Government and the Northern Territory in that it is the first lithium-focused mineral lease ever awarded in the NT and moves the NT much closer to having its first operating lithium mine.

Notably, the mineral lease has been awarded three months earlier than anticipated.

Core managing director Stephen Biggins said: “As we continue on our path towards becoming Australia’s first lithium producer outside of Western Australia, it’s important that we don’t let any of these important milestones pass us without reflecting on both their significance and importance for Core.

“With the mineral lease secured for Grants, Core is now well on the way towards becoming the Northern Territory’s first lithium producer.

Core's Finnis project and its proposed Grants mine in the Northern Territory

“The definitive feasibility study on Grants is expected to be delivered by the end of the March quarter, with first production at the Finniss Lithium Project on-track for the end of 2019.”

The laboratory assay intervals indicate average grades in the order of 24-27% iron.

Drilling results of significance

Notably, laboratory assay results are on average 18% higher than the previously reported handheld Niton XRF analyses, which is at the upper end of the expected increase of 10-20%.

This drilling is part of a comprehensive program of work currently being performed and funded by SIMEC Mining (an affiliate of the GFG Alliance) as part of their due diligence investigation of the commercialisation potential of Havilah’s Maldorky and Grants iron ore projects.

The drilling program was implemented and supervised by Havilah personnel.

The in-country team is using two RC drill rigs that worked up to Christmas, with one being recommissioned on Columbia Hill.

Investigating satellite targets

This rig has been progressing investigations on satellite open-cast targets on 83MR with the phase II program at Columbia Hill underway after 1,216 metres was completed last month over 17 holes.

Guy said: “Just 3km to the west of the TGME plant, Columbia Hill continues to show good potential, so much so that additional drilling is now underway to build up the geological model for that deposit.”

Satellite deposits within a few kilometres of the TGME CIL plant.

The Iota (Rho Reef) underground workings are on the eastern extension at this target and the RC drilling is targeting ground peripheral to these zones.

High grades at Columbia Hill

Results to date have confirmed more high-grade shallow gold intersections on the Bevetts and Rho reefs.

They include 1-metre at 10.1 g/t from 18 metres, 1-metre at 5.6 g/t from 68 metres, 1-metre at 7.5 g/t from 31 metres and 10 metres at 1.9 g/t from 36 metres.

Columbia Hill continues to demonstrate good potential as a satellite open-cast resource, particularly with the mineralisation style and intersections all above 80 metres below surface.

Initial resource estimations are expected to be completed next month.

Scammells drilling

Phase I drilling has also been completed at the Scammells target with best results of 1-metre at 5.6 g/t from 18 metres and 1-metre at 13.8 g/t from 20 metres.

AUZ’s managing director Benjamin Bell said: “With the majority of assays now received from our 2018 drilling campaign to grow the cobalt and nickel resources at Sconi, it is clear that this project has enormous potential to grow beyond the already strong commercial development case highlighted in November’s bankable feasibility study.

“Our technical team successfully evaluated the extensional potential in areas at both the
Greenvale and the nearby Lucknow deposits ahead of the campaign and it is clear from these results that the drilling has the potential to reinforce that modelling in a significant way.

“We believe the deposits at Sconi have a lot more to give in terms of resources, which is clearly reflected in the almost three-and-a-half per cent record cobalt hit returned in these results.

“Our focus now is on incorporating these outstanding results in a re-estimation of the Mineral
Resource for the Sconi Project, which will allow us to undertake what we believe will be a material optimisation review of our development case for Sconi published in the initial BFS on the project.

“I would like to take this opportunity to thank the company’s dedicated and talented technical team who planned and executed this program.”

BFS values project at $697 million

During November 2018, AUZ released a bankable feasibility study (BFS) for its Sconi Cobalt-Nickel-Scandium Project in Queensland, valuing the project at $697 million.

Three open pits would be constructed under the project along with a processing plant with annual ore processing capacity of 2 million tonnes.

Drilling highlights

The drill results significantly expand the mineralised footprint of the Sconi Project beyond its current JORC-compliant Mineral Resource and Ore Reserve.

The company provides fully integrated digital entertainment solutions to the resource, hotel, lifestyle village and aged care sectors.

Swift has delivered consistent growth in the resources market vertical over the course of 2018, both through direct contract wins and new clients secured by reseller partners.

The company continues to view resources as an attractive growth opportunity in light of the significant pipeline of new mining exploration, construction and development projects underway throughout Australia.

This was the final pumping rate over the last 24 hours of testing and notably, it was increasing as testing ended.

The associated gas in the flow increases the barrels of oil equivalent (boe) flow rate to 340 boe per day.

While rates were increasing when the flow test ended, the PLJV determined the field was commercial and ongoing testing costs could be better directed to bringing the field into long term, lower cost production.

Whitebark’s managing director David Messina said: “The oil discovery by the Wizard well is an excellent result and Whitebark is very pleased with the oil flow rates from the first well.

“This is just the sort of success WBE has been targeting and we look forward to pushing ahead with further appraisal work and production operations during the first half of 2019.

“The flow test results are very similar to those seen by other operators in the same reservoir during clean up flows of oil bearing reservoirs, which provides confidence about future wells in the pool.

“The PLJV will now bring the well onto production and determine the best approach to develop this new discovery.”

Rex well will increase total oil production by over 200%

Whitebark’s share of oil production at this rate would increase total oil production by over 200%.

Next steps to develop the Rex oil pool will be to tie-in the solution gas to a nearby gas processing facility and install a battery.

Rex prospect has the potential for 10-14 follow up development wells

The Rex target at Wizard Lake is the first horizontal well to be drilled in what could be a multi-well program analogous to the offsetting Leduc area Rex.

Sandfire has made a non-binding indicative offer of 38c a share just as MOD has completed launched a A$15mln, which comprised a fully underwritten rights issue at 24c and an institutional placing at 30c per share.

MOD said the offer “undervalues MOD’s unique and extensive assets” even though it is pitched at a substantial premium to both the prices of the fund raise and the market price beforehand.

The company owns 100% of the T3 copper project in Botswana and listed in London in November to raise awareness about the project.

In a statement revealing the offer, as well as confirming the capital raise, MOD said: “The Company is willing to engage with Sandfire and grant confirmatory due diligence if a compelling price is presented and capable of being supported by the Board and MOD shareholders.”

But, it added: “MOD has not received any offer capable of acceptance by the Company's shareholders and no certainty that the Indicative Proposal will result in a transaction.”

Metal Tiger confirmed that it has made a non-binding commitment to take up its entitlements under the rights issue.

MOD’s managing director, Julian Hanna said: “Funding from this capital raise will enable the Company to progress the T3 Copper Project towards a development decision and conduct further drilling for additional resources.”

He added; “The unsolicited, indicative proposal for 100% of the Company received from Sandfire confirms the potential of the T3 Copper Project, however the Board considers it significantly undervalues the assets of the Company.”

In afternoon trading in London, shares in dual-listed MOD were up 60.7% to 22.50p, while Metal Tiger shares were up 22.5% to 1.5p.

Metal Tiger owns 12.5% of MOD and substantial options after it swapped its stake in T3 for shares in its partner and 30% of an exploration joint venture in numerous licences that surround the T3 copper development.

-- Adds further detail, updates share prices --

]]>Mon, 21 Jan 2019 09:29:00 +1100European Lithium has near-term DFS catalysts for integrated lithium supply strategy in Europehttps://www.proactiveinvestors.com.au/companies/news/212911/european-lithium-has-near-term-dfs-catalysts-for-integrated-lithium-supply-strategy-in-europe-212911.html
https://www.proactiveinvestors.com.au/companies/news/212911/european-lithium-has-near-term-dfs-catalysts-for-integrated-lithium-supply-strategy-in-europe-212911.htmlEuropean Lithium Ltd (ASX:EUR) (FRA:PF8) (NEX:EUR) has its sights set firmly on a vertically integrated lithium supply strategy in Europe and has a number of near-term definitive feasibility study (DFS) catalysts which will see it move nearer to the prize.

Unlike most other ASX-listed lithium players that are focused on China or Korea, EUR sees Europe as the key to unlocking the value of its lithium strategy.

With an advanced lithium project in Austria, a European financing facility, German metallurgical and processing technology, and growing demand from the nascent lithium battery plants of Europe, it is little wonder the company has increased access to European investors.

This has come through the recent listing on the London-based NEX Exchange Growth Market.

Last month Dorfner Anzaplan was awarded the contract for complex metallurgical test work and pilot processing as part of the DFS and immediately began work.

A 300-tonne sample with 150 tonnes each for Amphiboltite Hosted Pegmatite (AHP) and Micaschist Hosted Pegmatite (MHP) has been sent to Dorfner Anzaplan’s German testing facilities for the detailed metallurgical process studies through the pilot plant.

This testing is to ensure a high-quality final lithium hydroxide is produced using the most efficient and competitive metallurgical processes from the beginning of the production cycle.

A mineralised sample from the Wolfsberg project.

Marketing work

Product marketing work is also progressing.

A marketing study by Benchmark Minerals Intelligence for the PFS projected that lithium hydroxide prices in Europe would continue to increase to a peak in 2022 and then decline to stabilise.

The project is a combination of exploration, prospecting and mining licences and selected minerals rights across 112 square kilometres of ground within the Paynes Find Greenstone Belt.

Oakajee has also lodged two exploration licence applications over 1,113 square kilometre Birrindudu Nickel Project covering parts of the Birrindudu Basin in the Northern Territory.

The company believes the project has the potential to host magmatic nickel-copper-PGE sulphide mineralisation.

Moving into a known goldfield

By acquiring Paynes Find, Oakajee would be moving into a known goldfield that has had limited exploration.

The project has advanced drill read targets and access to infrastructure.

Work completed by geological consultants has identified three advanced targets based on the past exploration work.

The three priority targets are Matriarch Gold Workings, Paynes Find South, and North Structural Target.

Shareholder approval required

Considering for an 80% interest in the project is $30,000 non-refundable deposit which has already been paid and a further $30,000 cash and $75,000 worth of shares upon settlement.

Settlement is conditional to a number of terms including due diligence, completion of a capital raising, and shareholder approval.

]]>Mon, 21 Jan 2019 08:41:00 +1100ParaZero applauds proposed FAA regulations for unmanned flighthttps://www.proactiveinvestors.com.au/companies/news/212935/parazero-applauds-proposed-faa-regulations-for-unmanned-flight-212935.html
https://www.proactiveinvestors.com.au/companies/news/212935/parazero-applauds-proposed-faa-regulations-for-unmanned-flight-212935.htmlParaZero Ltd (ASX:PRZ) is set to benefit from proposed Federal Aviation Administration (FAA) regulations which would allow routine flights over people and at night for the first time.

The US aviation authority is proposing three categories of aircraft with corresponding operational allowances for flight over people and will require certain safety conditions to be met.

ParaZero’s SafeAir safety solutions are ideally designed to fit into two of the three categories and will substantially increase commercial opportunities for the company.

ParaZero chief executive officer Eden Attias said the proposed regulations were a step in the right direction for the US market to conform to similar standards already operating in other jurisdictions.

Attias said: “They make good sense for an industry looking to expand and allow widespread commercial applications in construction, news and media, agriculture, first response and more.”

ParaZero is the only company which has had its parachute systems used in several successful waiver applications for flight over unprotected people.

The new regulations would replace the need for operational waivers and provide a strong regulatory environment.

The three proposed categories separate aircraft by size and the level of kinetic energy potentially transferred to a human.

Category one would allow unrestricted flight over people for small drones weighing less than 250 grams whereas category two has a transferable kinetic energy limit designed to limit significant injuries.

The third category will allow flight over people with certain operational limitations and have a higher kinetic energy limit than category two.

Attias continued: “For the unmanned aircraft industry, the proposed new regulations are the equivalent of requiring all cars to contain airbags as a standard safety feature.

“They provide significant commercial opportunities for ParaZero, particularly as the inclusion of our parachute safety system has already been approved by the FAA in waiver applications for flights over people.

Following the company’s three-stage mine plan for Geko, stage one was completed in December last year with ore above the grade of 22.75 g/t sold to gold major Northern Star Resources (ASX:NST) and the remainder stockpiled.

Five crops, including tomatoes, herbs and flowers, will be grown in these greenhouses.

Follows successful first agricultural project

This purchase order is payable to Roots in instalments during 2019, with the first instalment to be paid immediately.

The order follows successful completion of Roots’ first agricultural project with Dagan in 2018, where RZTO heating and cooling systems were installed in nine greenhouses.

This also formed part of Dagan’s distribution agreement with Roots which entails exclusivity conditional on US$19 million in sales over a five-year period.

“Great yield and quality increases”

Roots co-founder and CEO Dr Sharon Devir said: “This second order from Dagan further strengthens our presence in the world’s largest agricultural market and aligns with our long-term targets in the region.

“We’re already seeing great yield and quality increases from crops grown in the first project.

Historical drilling, anomalous gold

Historical shallow drilling has also intersected anomalous gold at several locations within an interpreted shear zone to the west of Randall Fault, although the drilling was sporadic and limited to islands within the lake.

Local geology is characterised by a north-northwest trending package of mafic/ultramafic rocks and clastic sediments separated by a faulted contact, like that seen in the company’s Farr-Jones prospect.

Carnarvon managing director Adrian Cook said the company and its joint venture partner had moved swiftly in the last quarter to start preparations for appraisal of the Dorado discovery.

He said: “The 2019 Dorado appraisal program will put the joint venture in a strong position to consider the final investment decision in 2020.”

Cook also welcomed operator Santos Limited (ASX:STO) into the joint venture, noting the oil and gas major’s expertise would be invaluable as Dorado moves through the appraisal, development and production phases.

Santos become majority owner and operator of the Phoenix project after it acquired previous joint venture partner Quadrant Energy.

The first Dorado well encountered substantial hydrocarbons with light oil, gas and condensate identified in a number of reservoirs.

A significant amount of data was collected from well logging and fluids sampling and comprehensive post-well evaluation of the data, including fluid analysis, reservoir studies, image log interpretation and core analysis, is underway.

The Dorado-2 appraisal well will target hydrocarbon columns in a down-dip location to confirm the extent of hydrocarbon accumulations and further calibrate reservoir and fluid properties.

A Noble Tom Prosser jack-up rig has been secured and is expected to begin drilling in April.

Drill stem tests for the Dorado-3 well are also being planned, which will be critical to understand reservoir performance and obtain representative fluid samples for the design of production facilities.

In discussions to progress Carnarvon’s Buffalo project both the company and the Timor-Leste government have agreed to the fundamental terms of a production sharing contract (PSC).

Carnarvon now aims to complete the contract and have it ready for signing upon the ratification of the Maritime Boundary Treaty between the Australian and Timor-Leste governments.

Cook said the discussions had been very positive to date with both parties agreeing in principles to the material elements of the PSC.

He added: “Carnarvon recently commenced a farm-out process for the Buffalo project.

“Discussions with potential partners are seeking to determine whether appropriate parties can add value and financing to the project while Carnarvon looks to bring both the Dorado and Buffalo projects into production.”

Along with submission of environmental plans, the company has completed a field surveillance program in the Buffalo area.

This indicated that there were no impediments to locating the wells in the surface locations most ideal for targeting the identified attic of oil.

Exploration work at other projects will include acquiring additional 3D seismic at the Ivory prospect within the Labyrinth project, close to the Dorado, Roc and Phoenix South discoveries.

Carnarvon’s geological analysis has identified 1.5 billion barrels of recoverable prospective resource within the permit and an estimated 420 million barrels of mean recoverable oil from the Ivory prospect.

Technical work at the Maracas project southwest of Labyrinth is ongoing and once complete the company will initiate a farm-out process to find a partner to continue testing of identified targets.

Maracas is offshore near Dampier and near existing infrastructure, producing fields and discoveries.

The permit area has shallow water depths of 60 metres and can be drilled with a cost-effective jack-up drilling rig.

Both the Condor and Eagle projects, south of the Buffalo field, are undergoing field work and technical analysis.

Carnarvon was awarded the Eagle permit last year with minimal commitments and will look to find a partner as it develops the project.

In November 2018 AVL increased the size and confidence of its JORC-compliant resource as a result of 19 RC holes for 1,863 metres and three diamond holes for 368.2 metres.

The updated total resource of 183.6 million tonnes at 0.76% vanadium pentoxide notably features a massive magnetite high-grade zone (HG10) of 96.7 million tonnes at 1% vanadium.

Algar said at the time: “The increased understanding and confidence further strengthens Gabanintha’s position as a world-class vanadium project in its size, grade and metallurgical recovery parameters.

In December last year the company released the pre-feasibility study results reporting a maiden ore reserve of 18.24 million tones at 1.04% V205.

Gabanintha’s maiden ore reserve comprises a proved reserve of 9.82 million tones at 1.07% V205 and a probable reserve of 8.42 million tonnes at 1.01% V205.

It is expected the site will produce around 900,000 tonnes per annum of 1.40% V205 magnetite concentrate at an average yield of 60%.

The planned V205 refinery at the site will have a production rate of 22.5 million pounds of V205 per annum over an initial mine of 17 years.

- Jessica Cummins

]]>Sun, 20 Jan 2019 21:35:00 +1100Admedus secures $8.6 million as Sio Partners becomes substantial holderhttps://www.proactiveinvestors.com.au/companies/news/212919/admedus-secures-86-million-as-sio-partners-becomes-substantial-holder-212919.html
https://www.proactiveinvestors.com.au/companies/news/212919/admedus-secures-86-million-as-sio-partners-becomes-substantial-holder-212919.html
Admedus Limited (ASX:AHZ) has secured a further $8.6 million in funding through shares placed to an initial substantial holder in its underwriting agreement from late November.

The new substantial holder Sio Partners and Capital Management have obtained 131,120,851 fully paid ordinary shares in Admedus, representing a 22.2% interest in the bio-tech company.

The company’s partially underwritten renounceable pro-rate entitlement offer was completed last quarter and raised a total of $19 million.

Admedus had a closing cash balance of $12 million at the end of last year.

ADAPT is a pioneering technology that enables the manufacture of biomaterial scaffolds that mimic human tissue.

It has been used to create scaffolds, such as the next generation collagen scaffold VascuCel, used in cardiac repairs and reconstruction procedures for many years.

The rights issue marks an important step in Admedus’ recapitalisation plan that it has been working towards since August 2018.

]]>Sun, 20 Jan 2019 21:28:00 +1100Red River Resources Ltd targets mill processing increases with systematic approachhttps://www.proactiveinvestors.com.au/companies/news/212918/red-river-resources-ltd-targets-mill-processing-increases-with-systematic-approach-212918.html
https://www.proactiveinvestors.com.au/companies/news/212918/red-river-resources-ltd-targets-mill-processing-increases-with-systematic-approach-212918.htmlRed River Resources Ltd (ASX:RVR) (FRA:R1R) is systematically working towards its ambition to further increase the ore processed at its Thalanga mill in Queensland so it can reach full annual capacity of 650,000 tonnes.

The Perth-based company has its sights set on continued improvements at its Thalanga Operations this quarter after record production in the December quarter.

The base metals producer increased its production take at the Thalanga Operations during the September and December quarters of 2018, the company revealed a week ago.

Revenue in the September 2018 quarter from concentrate sales had been $16.3 million.

Red River’s total tonnes mined for Thalanga came solely from the West 45 deposit.

West 45 had a JORC-compliant ore reserve of 567,000 tonnes grading 11.6% zinc equivalent and a mineral resource estimate of 582,000 tonnes grading 15.45% zinc equivalent using a cut-off grade of 5% zinc equivalent, on December 20, 2017.

The north Queensland project is 65 kilometres southwest of Charters Towers.

Red River underwent a step change increase in production in the June 2018 quarter at Thalanga, increasing production by 19 tonnes, or 29.2%, to 84 tonnes a quarter during the period.

Ore processed was 95,000 tonnes for the December 2018 quarter and 187 tonnes for the December 2018 half-year to 187,000 tonnes — an annualised 374,000 tonnes which does not take into account expected future increases to production at the site.

Red River has previously said it hoped to take advantage of “high cyclical zinc prices and historically low zinc concentrate treatment charges”.

Red River’s achievements in the September 2018 quarter included a maiden JORC mineral resource estimate of 1.5 million tonnes grading 12.2% zinc equivalent for the Liontown East deposit and an increase in the Liontown project mineral resource to 3.6 million tonnes grading 10% zinc equivalent.

The company is also hoping to define mineable tonnes at Orient and incorporate these with Liontown Waterloo’s resources into its mine plan.

Red River’s corporate strategy is to ‘find more ore’ so it can reach the full capacity of its 650,000 tonnes a year plant at Thalanga.

The approach involves extending the life of known deposits, optimising cut-off grades, finding next-generation deposits at Thalanga and acquiring new projects or reaching strategic agreements with other project owners.

Red River’s focused exploration efforts are to use cutting edge technology and the latest exploration methodologies.

The company expect new project acquisitions and strategic agreements will help it process more ore through its plant.

Red River managing director Mel Palancian said last week: “We are looking forward to continued improvements in the March quarter.”

The company plans to start production at its Far West deposit at Thalanga in the March 2019 quarter.

Red River’s March 2019 quarterly figures will be the first to include ore mined from outside the West 45 deposit as the company targets a 276,000 tonnes a year, or 74%, increase in ore processed at its plant.

Far West deposit has an estimated mine life of six years and a reserve of 1.5 million tonnes at 12% zinc equivalent.

The company advanced the decline of the Far West deposit in preparation last quarter, with further drilling early this year to target extensions to high-grade mineralisation.

Managing director Palancian highlighted continued improvements to mine production and processing plant efficiency in what will prove a prequel to the company’s quarterly activities report.

He wrote on behalf of the board: “RVR is focused on maximising returns from the operation by increasing plant throughput and extending mine life through increasing mineral resources and ore reserves at deposits currently in the mine plan (West 45, Far West and Liontown Waterloo).

Palancian reported the company also planned to convert “mineral resources into ore reserves at Liontown and Orient and … aggressively (explore) our growing pipeline of high-quality targets and projects.”

The samples from the central zone of the prospect average 2.66 g/t and lie within a 900 by 530-metre envelope averaging 1.76 g/t.

Analysis of the multi-element geochemistry and correlation with surface mapping confirms that gold mineralisation is hosted by a porphyritic diorite but also extends into altered monzonite.

Two types of mineralisation are clearly distinguishable: an early stockwork phase of disseminated mineralisation averaging 1.5 g/t; cut through by a later high-grade epithermal vein population average about 8 g/t.

Despite Cyclone Owen’s effect on the Brisbane-based company, its crew still managed to load 220,000 tonnes of bauxite last month.

2018 was the company’s first year of operations at the Bauxite Hills mine and it met its guidance target of 2 million wmt of shipped production.

At the dawn of the new year, Metro Mining’s total shipped production figure for 2018 was 2.037 million wmt from Bauxite Hills.

The mine began production in April 2018 and has an estimated reserve of 92.2 million tonnes and total resources of 144.8 million tonnes.

It is tipped to deliver bauxite into China over a 17-year mine life.

Metro managing director & CEO Simon Finnis acknowledged the production milestone on December 31, 2019, saying: “This is a great result for Metro.

“Not only have we achieved guidance for 2018 in our first operational year, but we’ve done so after our operations have twice been interrupted by cyclones, at either end of the operating year.”

Metro will up production levels this year, announcing in November 2018 it would set guidance at 3.5 million wmt to meet strong customer demand.

In late November the company had contracts for 69% of the expanded 2019 production forecast.

Finniss said at the time: “This year your company has transitioned smoothly from a developer to a producer with a significant growth outlook and continues to look for ways to improve and take advantage of market forces.”

One of the ways the company plans to improve is to bring production in-house.

The company plans to restart its operations in April 2019, after the wet season, and have its team mine the resources.

As a result, Metro has terminated its contract mining agreement with SAB Mining.

Finnis explained: “Now that we’ve commissioned and ramped up the project during 2018, it is a natural transition to own and operate our mining equipment.

“We have an excellent management team in place at the mine that is eminently capable of managing the mining function, so we see this as a logical step to increase efficiencies and reduce operating costs as we increase production to 3.5 million tonnes in 2019.”

Much of the Bauxite Hills existing plant and infrastructure has been designed to accommodate higher operating levels, so the initiatives may prove low-cost and easy to implement.

The company is also planning to update a stage II scenario from its definitive feasibility study (DFS) in the second half of 2019 to incorporate a production expansion to 6 million tonnes and then present an investment option to Metro’s board.

Coal assets review

Metro is undertaking a review of opportunities for its coal assets which are housed in a subsidiary.

Major shareholder DADI Engineering Development Group’s former representative on the Metro board Xiaoming (Aaron) Yuan joined the subsidiary’s board in November 2018 on his retirement from Metro’s board.

Yuan spent eight years on Metro’s board.

Two options for the coal assets are divesting them or forming a joint venture.

Quarterly cash report

Metro had $22.9 million cash at the end of the September 2018 quarter, with cash and trade receivables sitting at $38.2 million.

The company used $3.2 million on operating activities during the quarter, spending $558,000 on investing activities and directing $3.4 million net cash towards financing activities.

Sales revenue for the period was $43.8 million after 822,000 wmt was shipped to five Chinese customers, including foundation customer Xinfa Group Corporation Limited.

Unit costs were about $46 a wmt.

The company had $14.77 million in loan facilities on September 30, 2019, with the full amount drawn down.

Metro’s estimated cash outflows for the December 2019 quarter were $44.3 million.

Tight capital structure

On August 28, 2018, Metro’s top 20 shareholders held 76.52% of the company.

There were 1,059,106,012 ordinary shares on issue.

The company’s substantial holders consisted of number-one shareholder Greenstone Management (Delaware) II LLC, with 19.75%, number two Balanced Property Group (15.22%), and number three BlackRock Group (Black Rock Inc and related entities) (10.82%).

Dadi Engineering Development (Group) Co Ltd and related entities was the fourth largest shareholder (5.65%) while Renaissance Smaller Companies was fifth largest (5.26%).

— with John Miller, Tharun George

]]>Sun, 20 Jan 2019 16:45:00 +1100Emmerson Resources pegs out territory for royalty-style returnshttps://www.proactiveinvestors.com.au/companies/news/212845/emmerson-resources-pegs-out-territory-for-royalty-style-returns-212845.html
https://www.proactiveinvestors.com.au/companies/news/212845/emmerson-resources-pegs-out-territory-for-royalty-style-returns-212845.html
Emmerson Resources Limited (ASX:ERM) (FRA:42E) has set a template for returns from its Tennant Creek mines in the Northern Territory, trucking ore from a small mine to a Territory Resources Ltd mill where the strategic partner will toll treat the gold.

The Western Australian company welcomed the trucking of first ore from the divested Edna Beryl mine last month to the mill at Cloncurry in northwest Queensland.

New mine owner Territory’s achievement was welcomed by Emmerson, which was to receive first commercial returns from Tennant Creek Mineral Field (TCMF) thanks to the milestone, in the form of 12% of gold produced.

Bills acknowledged last month the company had changed tack, saying “it’s more like a royalty company now out of Tennant Creek.

“Now that we’ve got a processing route, a way to monetise these things, potentially once we drill out Mauretania, then that will also become one of the small mines.

“We obviously have to negotiate commercial terms with Territory around that, but we now have a processing route, so we can monetise it.

“From the shareholder point of view, rather than just doing exploration and it sitting there, we can now monetise it.”

Selling the mines and taking a share of the gold or profit brings in returns for the company which also sold a mill on the field to Territory, which the partner is refurbishing.

Bills told Proactive Emmerson planned to use the funds collected from its monetisation model to self-fund exploration at its projects in the NT and New South Wales.

He said in the December 12 interview: “We have aimed to get to the production stage as soon as possible so this arrangement short-circuits the process and enables us to get early cash flow.

“Edna Beryl is the first of our small mines and we get 12% of the gold produced out of that mill.

“We do not pay for any of the mining, processing or transport, so it doesn’t really matter where it gets processed.”

The strategic partners’ templated approach will result in varied returns to the company, depending on the arrangement.

Bills told Stocktube: “We get 12% of the gold, 6% of the gold or a profit share-type basis and Territory does the mining and processing.

“In terms of the other small mines, at this stage, it looks like Black Snake and maybe Chariot will be the next mines.

“This will be determined by a mine schedule which Territory is doing a lot of work on, while the permitting process is being progressed by the Northern Territory Government.”

Emmerson's priority focus at Tennant Creek in the NT

Tennant Creek Mineral Field assets

Emmerson has accumulated a portfolio of small mines in the Tennant Creek Mineral Field (TCMF).

The TCMF is one of Australia's highest grade gold and copper fields, producing more than 5.5 million ounces of gold and 470,000 tonnes of copper from historical deposits including Warrego, White Devil, Orlando, Gecko, Chariot and Golden Forty.

Emmerson made the first discoveries on the field in a decade, with the finds including high-grade gold at Edna Beryl and Mauretania and copper-gold at Goanna and Monitor.

Emmerson sold Territory the Warrego Mill on the Tennant Creek field last year.

The partner will use the mill it is refurbishing it to service future production from the mineral field.

This refurbished mill will come on board in the June 2019 half-year, and could be ready as early as the March 2019 quarter.

Emmerson’s managing director said the benefits of the strategic alliance were that it had the exploration expertise while Territory had the mining and milling capability.

“This will enable us to work together to unlock all of these stranded gold assets.”

Although Emmerson sold Edna Beryl, the company has retained 100% of the remaining 75% of the Tennant Creek field, including the recent discovery at Mauretania.

The company finished drilling on the field in December 2018 and is expecting results from the drilling campaign by late January or early February 2019.

Bills confirmed the expected timing and told Stocktube: “One of our flagship discoveries called Mauretania … we drilled some really exciting looking rocks there, and some very thick intersections of what we think potentially could the host of the gold.

New South Wales portfolio plans

The arc hosts more than 80 million ounces of gold and more than 13 million tonnes of copper, with the deposits heavily weighted to areas of outcrop or limited cover.

Emmerson believes there is an opportunity to apply its predictive targeting models and systematic exploration approach to discover new deposits of copper and gold on the field.

The company said five of its projects in the state had many attributes seen in deposits on the arc but had been under-explored due to overlying cover, such as farmland, and lack of systematic exploration.

Fifield project in NSW, which features the Whatling Hill copper-gold prospect

Emmerson plans to drill its NSW ground this year, at targets such as the Whatling Hill copper-gold prospect at Fifield project.

The explorer had encouraging soil geochemistry results from an enlarged aircore drilling program at the discovery and is increasing its landholding in the area, within the Lachlan Transfer Zone.

Bills told Proactive’s Stocktube video channel in November 2018 the company believed it had found a cluster of deposits in NSW.

He said: “Our thinking is that we’re onto a number of these deposits.

“There's some good news at Kadungle, we’ve now got good news at Whatling Hill and south of Watling Hill; so we think that we’re onto a cluster of these porphyry copper deposits.”

Capital matters

Emmerson had $4 million cash at the end of September 2018 financial quarter after using $797,000 for operating activities, tipping $56,000 into investing activities and taking $1 million from issuing shares during the quarter.

On September 27, 2018, the company had two substantial shareholders, JP Morgan Nominees Australia Limited with 12.63% and Evolution Mining Limited with 11.84%.

The Sydney-based company focuses on the production, development, and exploration of metallurgical coal assets in North America. The Australian company’s flagship property is the Elko coking coal project, which covers an area of 3,571 hectares located in British Columbia, Canada. Coal from the Elko region contains coking properties that are sought after by South East Asian steel mills."
]]>Sun, 20 Jan 2019 15:46:00 +1100Leading Edge Materials prepares to start prep work on Battery Demo Planthttps://www.proactiveinvestors.com.au/companies/stocktube/11896/leading-edge-materials-prepares-to-start-prep-work-on-battery-demo-plant-11896.html
https://www.proactiveinvestors.com.au/companies/stocktube/11896/leading-edge-materials-prepares-to-start-prep-work-on-battery-demo-plant-11896.html
Leading Edge Materials (CVE:LEM) President and CEO Blair Way joined Steve Darling from Proactive Investors Vancouver to provide a 2018 recap on the Sweden based company. Way also shared details of their capital raise.

Way also gave some details about the progress on their Battery Demo Plant and the major advantages the company has being in Sweden.

]]>Fri, 18 Jan 2019 18:14:00 +1100Nelson Resources applies for new exploration tenements in the Eastern Goldfieldshttps://www.proactiveinvestors.com.au/companies/news/212842/nelson-resources-applies-for-new-exploration-tenements-in-the-eastern-goldfields-212842.html
https://www.proactiveinvestors.com.au/companies/news/212842/nelson-resources-applies-for-new-exploration-tenements-in-the-eastern-goldfields-212842.htmlNelson Resources Ltd (ASX:NES) has applied for two new tenements in the vicinity of its Socrates and Grindall projects in Western Australia’s Eastern Goldfields.

These tenements include a substantial portion of Sipa Resources Ltd (ASX:SRI) and Newmont Exploration’s historical Woodline project and fully incorporates the Theofrastos prospect (now referred to as the Redmill project).

Interestingly, these companies have spent circa $2.6 million on exploration on Redmill.

Current projects and applications

The tenement applications (if granted) will take Nelson’s landholding in this highly prospective area from 150 square kilometres to about 450 square kilometres.

Nelson’s new works programs will include follow up and evaluation of the previous exploration in the area.

Redmill Project

The Redmill project is defined by a 6-kilometre by 2-kilometre gold-in-calcrete anomaly.

The mineralised system is thought to be hosted in granitoid and micro diorite with variable degrees of deformation.

The 66% increase in total resource was achieved by adding the 633,000 ounces gold resource at the Twin Hills gold deposits.

Both the existing Mount Coolon deposits (Koala, Glen Eva and Eugenia) and the Twin Hills deposits (309 and Lone Sister) are considered by GBM to hold significant exploration upside.

Mount Coolon Gold Project resource

Mount Coolon is planned to be developed as a central processing hub with the proposed co-development of Twin Hills to provide high-grade satellite feed.

Notably, the Twin Hills mineral system has been interpreted as an intrusion-related, low sulphidation, epithermal system containing high gold fineness deposits.

Both 309 and Lone Sister remain open at depth with the current resource limited by drilling to about 300 metres below surface.

It is worth noting that the 2017 Mount Coolon Scoping Study has already demonstrated the potential to generate strong positive cash flow from existing deposits (Koala, Glen Eva and Eugenia) prior to inclusion of Twin Hills.

Mt Coolon Gold Project tenement group location plan

The Twin Hills tenements are not owned by GBM and are subject to a binding sale and purchase agreement which was signed with Minjar Gold Pty Ltd in September 2018 to acquire a 100% interest in the Twin Hills Gold Deposits.

Certain conditions precedent have to be satisfied by GBM by February 28, 2019.

]]>Fri, 18 Jan 2019 15:17:00 +1100King River Resources advancing new vanadium-titanium-iron development plan for Speewahhttps://www.proactiveinvestors.com.au/companies/news/212837/king-river-resources-advancing-new-vanadium-titanium-iron-development-plan-for-speewah-212837.html
https://www.proactiveinvestors.com.au/companies/news/212837/king-river-resources-advancing-new-vanadium-titanium-iron-development-plan-for-speewah-212837.htmlKing River Resources Ltd’s (ASX:KRR) metallurgical results continue to support advancing a new vanadium-titanium-iron development plan for its Speewah Vanadium Project in the East Kimberley of Western Australia.

The company has been conducting sulphuric acid (H2SO4) bottle roll and diagnostic vat leach tests on magnetite-ilmenite concentrate and coarse magnetite gabbro lumps from the high-grade zone of the Central Vanadium deposit.

This test work was designed to assess whether the Speewah magnetite gabbro is best suited for vat or heap leaching prior to completing laboratory diagnostic vat and column leach tests.

Observations and conclusions that can be drawn from the bottle roll test results include the following:

• Vanadium, titanium, iron, magnesium and aluminium leach efficiencies (extractions) are very good and support advancing the test work on lump material; and

• The vanadium and titanium extractions increase as the lump or grain size decreases for the same time interval.

Vat leach test work

King River’s diagnostic heated vat leach test work on 3.35mm and 5.6mm lump samples will allow the critical process parameters to be adjusted and recorded.

The initial diagnostic vat results show:

• Up to 92% vanadium and 61% titanium leach extraction after 10 days (240 hours); and
• Higher leach temperature and maintaining acid at 150-200mg/L have significantly increased the leaching rate of all metals.

Analysis

King River’s board is encouraged by the bottle roll and vat leach test results to date and will now fast-track the vat and column leach test work.

This will enable the vat leach plant design and costings to be finalised as soon as possible.

A trade-off analysis into the optimum particle size will also be undertaken.

There may prove to be some potential to use a coarse 2mm concentrate for the vat leach operation as it would significantly reduce the amount of material leached and possibly shorten leaching times.

A 2mm concentrate beneficiation plant would also be a simpler design to the facility used in the recently released vanadium scoping study that generated a 106 micron (~1/10th of a mm) concentrate.

Alternatively, if lump ROM material was chosen in the coming months to be the most economical option to be used in the PFS (pre-feasibility study), then there will be no fine grinding or magnetic separation circuit required.

During 2019, KRC aims to present shareholders with the most prudent commercial strategy to develop the Speewah vanadium deposits and advance towards the production of vanadium, titanium and iron products at the lowest possible unit cost.

]]>Fri, 18 Jan 2019 13:21:00 +1100Renegade Exploration drill results reveals high-grade thick gold intersectionshttps://www.proactiveinvestors.com.au/companies/news/212836/renegade-exploration-drill-results-reveals-high-grade-thick-gold-intersections-212836.html
https://www.proactiveinvestors.com.au/companies/news/212836/renegade-exploration-drill-results-reveals-high-grade-thick-gold-intersections-212836.htmlRenegade Exploration Ltd (ASX:RNX) has received all of the results for its aircore drilling program completed at its Yandal East Gold Project in Western Australia.

The 62-hole, 7,189-metre drilling program identified both high-grade and thick mineralisation at multiple targets across the project.

This drilling was following up the August 2018 inaugural aircore program at Yandal East for 23,789 metres, testing five of its original nine high priority targets.

These latest results show high-grade mineralisation at Mizina South with grades of up to 5.74 g/t gold and thick mineralisation at Ward including 23 and 20 metre intervals.

Ward and Mizina South produce best results

19 holes were drilled at the Ward Prospect and 15 holes at the Mizina South Prospect, following up the inaugural drilling.

Highlights from Ward included 23 metres at 1.38 g/t gold from 84 metres and 20 metres at 1.02 g/t gold from 88 metres.

These results confirm the prospectively of the previously undrilled section of the corridor.

The highlight from Mizina South was the gold grades encountered.

The November program delineated high-grade gold mineralisation over 400 metres with values of 5.74 g/t and 4.11 g/t gold.

Renegade noted that it was excited about the developing potential of the Mizina South and the greater Mizina area and looks forward to completing further work in 2019.

]]>Fri, 18 Jan 2019 12:43:00 +1100Bulls, Bears & Brokers: Tony Locantro on the merits of using full service brokershttps://www.proactiveinvestors.com.au/companies/stocktube/11872/bulls-bears--brokers-tony-locantro-on-the-merits-of-using-full-service-brokers-11872.html
https://www.proactiveinvestors.com.au/companies/stocktube/11872/bulls-bears--brokers-tony-locantro-on-the-merits-of-using-full-service-brokers-11872.html
Tony Locantro, stock market pundit and investment manager at Alto Capital, explains to Proactive Investors the merits of using a broker, and breaks down the virtues of using full service versus discounted providers of brokerage services.

For all of Tony's Tips and insights, watch our full video interview.

]]>Fri, 18 Jan 2019 12:00:00 +1100Bellevue Gold is Top Explorer Pick Winner for 2019 by Macquarie Researchhttps://www.proactiveinvestors.com.au/companies/news/212834/bellevue-gold-is-top-explorer-pick-winner-for-2019-by-macquarie-research-212834.html
https://www.proactiveinvestors.com.au/companies/news/212834/bellevue-gold-is-top-explorer-pick-winner-for-2019-by-macquarie-research-212834.htmlBellevue Gold Ltd (ASX:BGL) has been picked as the only high conviction Top Explorer Pick Winner for 2019 by Macquarie Research.

The company accomplished this after having successfully delineated a high-grade inferred resource of 1 million ounces of gold at 12.4 g/t gold last year at its Bellevue Gold Project in Western Australia.

Gold Road (Outperform, Target Price: $0.80, Ben Crowley)

Construction of the Gruyere Gold Project (50% GOR) is now >85% complete with first gold set for early 2QCY19.

We expect GOR to receive a positive re-rate over 2019 as the company moves from a developer to a gold producer.

Exploration continues to provide upside potential to GOR with the company set to spend A$17-20 million on its systematic exploration program over the largest tenement package in the Yamarna Greenstone Belt.

Cardinal Resources (Outperform, Target Price: $0.80, Michael Gray)

Cardinal’s 7 million ounces gold Namdini open pit project in Ghana has a 270,000-ounce gold production profile as underpinned by its Sep/18 PFS study.

Goldfield’s, with two gold mines in Ghana, holds an 11% equity position that was purchased in the market and provides a strong validation for Namdini in our view.

We expect CDV to increasingly gain market attention and re-rate throughout 2019 as highlighted in our initiation – it controls one of the few potential Tier 1 assets globally.

Global Development Projects >250,000 ounces of gold per annum LOM production profile – owned by single asset developers

This assertion is supported by the exploration land position that has high potential to yield new satellite discoveries that could feed a central mill and for new standalone discoveries in the highly prospective Birimian Greenstone geology in Northern Ghana.

We expect exploration results, a DFS and a construction decision to be the key catalysts in 2019 and believe CDV is a prime target amongst the senior and intermediate producers.

The company is developing the Mahenge Graphite Project in south-eastern Tanzania.

Black Rock published a definitive feasibility study (DFS) in October 2018, which followed the pre-feasibility study (PFS) completed in April 2017.

The following is an extract from the report:

Unjustifiably cheap. The project has a post-tax, unlevered NPV10 of US$895m, and an IRR of ~43%, both net of the Tanzanian government’s 16% stake. The NPV is ~7x the initial capex requirement of US$115m. Despite these strong metrics, Black Rock’s market capitalisation is less than 2% of NPV. Assuming total initial capital required of US$140m, 80:20 debt-to-equity funding, equity being issued at A$0.10 to A$0.15 per share, and a fair EV valuation, 12 months from now, of 30-50% of NPV, then Black Rock’s EV could be US$269m to US$448m. This equates to a valuation of A$0.16-0.40 per share, ~4-11x the current share price.

Opportunity knocks: In a sample of eight ASX-listed African graphite developers, there is only a US$16m difference in market capitalisation between the largest and smallest. The market is not differentiating between projects, meaning it has so far failed to take advantage of the opportunity in Black Rock.

Compelling project, with substantial cash flows: The DFS envisages a three-phase project ultimately producing 240,000 tpa high-grade graphite. When completed, Black Rock is likely to be the 2nd largest miner of natural flake graphite in the world ex-China. Based on DFS figures of a US$1,301/t basket selling price, and US$401/t C1 costs, annual EBITDA will be around US$216m, equating to an EBITDA margin of 69%. The project is expected to generate US$313m in EBITDA over the first three years. This strong cash generation is expected to support a high-level of debt financing, limiting the dilution to existing shareholders.

Risk mitigation a key part of the DFS: The DFS was compiled after more than 25,000 man-hours of work. It incorporates the results from a large-scale pilot plant, improvements in the plant design over 15 iterations, a decision to use dry-stacking, development of an ultra-high-grade graphite product, logistics tests on the Tanzania Zambia Railway Authority (TAZARA) railway, customer testing of Mahenge graphite products, and operational readiness work designed to provide a smooth ramp-up, and to address concentrate transportation. Management’s approach has been to reduce as many risks as possible.

Significant advantages, both geological…: Mahenge hosts the 2nd largest graphite reserve, and the 4thth largest JORC-compliant graphite resource globally. The resource is biased towards larger flake sizes. Strip ratios are low. Impurities are at a minimum. Black Rock has demonstrated the ability to produce amongst the highest quality products globally, without chemical interference. This means lower capital and operating costs, less environmental impact, and a differentiated high-value product. The use of dry-stacking means there is no need for wet tailings dams, and the risks they impose. There is no need to dispose of used hydrofluoric acid, which can be difficult.

…And geographical. Access to key infrastructure is excellent, and provides the Mahenge project with a long-term sustainable cost advantage. This includes the TAZARA railway line, which feeds directly into the port of Dar es Salaam. The port is an internationally vital trade link serving seven countries. It handles 95% of Tanzania’s trade cargoes. There is frequent shipping to key markets in Asia. The Tanzania Electric Supply Co Ltd (TANESCO) will provide grid power. Excellent logistics ensures there is no need for unsafe several hundredkilometre truck journeys, no uncertainty as to available port capacity, no barging and reloading, and no need for expensive diesel generators on site.

Phases 1 and 2 are already sold out: Critically, Black Rock spent the past year demonstrating a path to market. A large-scale pilot plant, an order of magnitude larger than the next, enabled delivery of certified samples to customers and laboratories. Feedback has been hugely positive. Three offtake agreements have been signed for a combined 205,000 tpa (in the third year), representing 85% of planned production, and an astonishing ~23% of 2017 global natural graphite demand. Notably, two of the agreements – those with Heilongjiang Bohao and Taihe Soar – are believed to be the two largest offtake agreements signed by any graphite company, either in production or development. The agreements cover a variety of end-use applications including expandable graphite, and energy storage. The agreements will enable Black Rock to establish branding in the energy storage market. The agreements are a testament to Black Rock’s notion that Mahenge graphite has unique properties that make it highly desirable to end-users.

Graphite demand growth accelerating: The births of the electric vehicle and energy storage systems markets have transformed the graphite market from a mature one, to one with rapid growth prospects. Both these industries are embryonic in nature, and growing at a terrific pace. There is also huge pent-up demand for expandable graphite for use in the foil and fire retardant segments. Demand for fire retardants is being driven by technological developments and more stringent safety standards in automotive, aerospace, and in building and construction after a number of large fires. Demand for natural flake graphite (excluding amorphous graphite) is expected to more than double over the next decade from ~630,000 tpa in 2017 to ~1.4m tpa in 2027. Even before accounting for any further curtailment in Chinese supply, the world could need the equivalent of three “Mahenges” to meet demand over the next decade.

Chinese supply is under pressure: Supplies of large flake graphite from China are dwindling as resources are depleted. Combined with strong growth in the expandable market, China is now short of large flake graphite, and has started importing +50 mesh material from East Africa. Environmental controls, mainly aimed at restricting the use of acids in graphite beneficiation, are being more strictly enforced. Over time, purer graphite sources are likely to attract premium prices.

Outlook for prices is excellent: The combination of new industries experiencing peak demand growth, and challenged supply out of China, the world’s largest producer, suggest a strong outlook for graphite prices. Experience from the iron ore and coal markets in the mid-2000s, suggests that increasing Chinese imports (or decreasing exports), may have a significantly positive impact on market prices. As a result, there is an immediate opportunity in large flake graphite, with new suppliers of high-quality materials able to sell into a rapid growth market that is seeing shortages.

Not all graphite is created equal; market segmentation is key: The market can be broadly divided into three categories;

Large flake: The market for 80 mesh and larger has massive pent-up demand, and is supply constrained. Changes in building regulations and challenged Chinese supply suggest an increasingly tight market with strong price outcomes. There is a step change in pricing above 98% purity and 80 mesh.

Battery grade: Typically, 150 to 80 mesh. The market has been demand constrained, though forecasts of exponential growth in the electric vehicle space suggest this will change quickly. High-grades, and spheronizing performance are differentiating factors. ‘Dirty’ concentrates containing impurities such as vanadium and others, will attract lower prices, and are at risk of stricter environmental controls in China. Selling directly to larger battery makers, where qualification can take years, is difficult. Establishing channels is critical.

Refractory grade: Generally, smaller flakes and lower grades, used in steel making and other metallurgy. Lower prices, and essentially the market of last resort for a graphite company. (Some high-end applications require premium product). Black Rock has unearthed significant demand for large flake, high-purity graphite. The company has also established channels for the battery sector through offtakes with Heilongjiang Bohao (which supplies the German automotive industry), and Qingdao Fujin Graphite (anodes for consumer electronics). Black Rock’s initial battery tests were conducted at a US-based, ISO-compliant laboratory. Battery cells produced from surface coated, spheronized natural flake from Ulanzi, exceeded 300 cycles, with a 94% recharge rate. The cells also had flatter performance curves than an existing commercial battery, indicating potential for longer battery life. This is a significant result that bodes well for future development. Few new projects are of global scale. The combination of strong demand, and challenged Chinese supply, has motivated a plethora of new projects in East Africa. Most of these are relatively small scale. The obvious hurdle many will face is completing a detailed DFS study that will be necessary to secure funding. Black Rock has set the bar in this regard. Further, many projects seem focused on the electric vehicle revolution. Though exciting, the market is currently small, and qualification periods, as for anything in the automotive sector, are long. Companies focusing on this space will need to find other markets to sustain themselves through this qualification period. It seems likely that over the next few years, supply from East Africa will become dominated by two large producers in Syrah Resources (SYR.AX), and Black Rock, with a number of smaller players serving niche markets.

Tanzania: Tanzania’s reset of its legislative code in 2017/18 negatively impacted risk perceptions, and the capacity to raise debt finance from traditional sources, and hit share prices. Yet over the past year, Tanzania has made great strides. Companies report that engagement with the government has been positive, and that projects that contribute positively to Tanzania’s development are being approved. Black Rock expects its mining licenses to be approved in early-2019. The country has a fast-growing economy, benefits from a young and educated workforce, and there is rapid investment in infrastructure. The government’s vision is for Tanzania to be semi-industrialised (manufacturing represents 40% of GDP) by 2025. In summary, the Mahenge graphite project has been thoroughly conceived. It boasts significant and sustainable natural advantages, it stands to benefit Tanzania directly through shared ownership, upgraded infrastructure, and increased employment, and it looks like coming on stream into a period of peak demand growth. Consequently, it also seems likely to reward shareholders.

As part of its financing strategy and post the DFS, Orior Capital was commissioned by Black Rock Mining to undertake a review of the business and graphite sector.

Best quarter yet

LiveHire’s CEO Christy Forest said: "The December quarter, which is a shorter and typically tougher quarter, was LiveHire’s best quarter yet with the company extremely well placed for continued growth in 2019.

“Our partnership with Korn Ferry has continued to drive strong growth with several significant new contracts secured from the developing pipeline.

“It is also encouraging to see the higher value clients we secured during the December quarter has generated growth in our annualised recurring revenue per client.

“We continue to activate more growth channels beyond RPO and Direct and we look forward to bringing these online soon.”

After achieving many permitting milestones in 2018, as at January 2019, Aeris is preparing to commence drilling at Torrens.

The heliportable drill rig and supplementary equipment, including work platforms, has arrived at site.

Furthermore, an exploration camp to accommodate the workforce for the phase I drilling program arrived on-site early in the New Year and is now fully operational.

Stage I drilling program is estimated to consist of 8-10 drill holes targeting depths of 700-1,500 metres.

]]>Fri, 18 Jan 2019 07:59:00 +1100Fiji Kava applauds government decision to ease kava import regulationshttps://www.proactiveinvestors.com.au/companies/news/212847/fiji-kava-applauds-government-decision-to-ease-kava-import-regulations-212847.html
https://www.proactiveinvestors.com.au/companies/news/212847/fiji-kava-applauds-government-decision-to-ease-kava-import-regulations-212847.htmlFiji Kava Ltd (ASX:FIJ) has had its efforts to make kava a new alternative to prescription medication validated by an Australian government easing kava importation regulations.

A significant breakthrough for the kava industry, the announcement represents a growing acceptance of Kava as a natural and safe alternative for managing stress and anxiety.

This move aligns with Fiji Kava’s efforts to make Kava a new alternative prescription medication, such as Valium and Xanax, currently representing a US$15 billion global benzodiazepine market.

Aligns with effort to make Kava alternative prescription

On a recent trip to Vanuatu last week Australian Prime Minister Scott Morrison announced the government will be working towards putting a pilot program in place “to ease some of the limitations on importation of kava into Australia.”

Morrison said: “Kava is an important product which is produced here and has a great and successful market around the world.”

“Step in the right direction”

Fiji Kava managing director Zane Yoshida said: “We are encouraged by the announcement made by Australian Prime Minister Scott Morrison.

“This is certainly a step in the right direction and Fiji Kava looks forward to the development of the pilot program.”

Cultural practice

Kava is a depressant drug that is traditionally consumed by Pacific Islanders in drink form for ceremonies and cultural practices.

According to the Australian Alcohol and Drug Foundation, many Pacific Islanders who have settled in Australia have continued drinking kava or using kava extracts.

Kava extracts are used in some herbal preparations and sold as over-the-counter tablets to treat insomnia, stress and anxiety.

Yandal East is within the well-endowed gold region known as the Yandal Greenstone Belt, 70 kilometres northeast of Wiluna.

The region has historically produced in excess of 10 million ounces of gold and Renegade’s permits are adjacent to and along strike in both directions from the Millrose deposit containing 309,000 ounces at 2.4 g/t.

Base metal exposure

The Yukon Base Metal Project in Canada was discovered by a prospector in 1996 and Renegade secured an option in January 2007 to earn a 90% interest in the project which it exercised in Juky 2007.

Thick high-grade mineralisation was intersected by Noranda Inc in a drilling program conducted in 2001, followed by a second program the next year.

The original project comprised 493 mineral claims covering 95 square kilometres over and around the Andrew zinc deposit.

Renegade has since expanded its land position and Yukon now comprises 1,554 mineral claims covering about 305 square kilometres.

Since 2007 the company has completed 350 diamond holes for more than 40,000 metres, discovered three separate zinc deposits and defined a JORC-compliant resource of 12.6 million tonnes at 5.3% zinc and 0.9% lead.

The survey involved placing geophysical profiles in an east-west direction over the same area mapped for its geology earlier last year and spaced 100-metres apart.

Three lithologies identified and five target areas

Results of the interpretation data highlighted three targets, with the most notable corresponding to a big structural complex north of the El Boldo artisanal mine on the property.

The second target is located up dip and only 150 metres from artisanal workings.

Further to production of the maps using Theta techniques, geophysical contractor Maping Ltda identified three clearly differentiated lithologies, a big structural complex and five target areas to focus follow-up exploration.

Follow-on activities

Reinterpretation of the data by an Australian contractor will provide further understanding of the project and enable the planning follow-on exploration.

On February 7, 2018, the company announced a farm-in agreement over the Plateado project with Antasitua Chile SPA, where Cougar could earn 100% by meeting various exploration expenditures and payments.

“Natural step” forward

“Months of planning, due diligence and research has gone into this exciting move into this major English-language market.

“With a population of more than 66 million, the UK market is approximately three times the size of our home markets of Australia and New Zealand.”

Available in the UK for spring

After its first showcase at the Mobile World conference in Barcelona last year, SPACETALK will return to the conference next month amongst the more than 100,000 executives and buyers.

Fortunatow said: “SPACETALK will be available on UK high streets in the northern spring retail season in the lead-up to school holidays.

“This is when the versatility of our all-in-one smart watch mobile phone will come into its own, just as it has this summer in Australia and New Zealand.

Australia and New Zealand sales “exceeded expectations”

“At this stage it is too early to say with absolute confidence what our sale expectations are, however, our first year Australian and New Zealand sales have exceeded expectations and we have been impressed by the enthusiasm and support expressed by UK retailers.”

Fortunatow also said: “The children’s smart-watch product is better known among UK parents than it was here.

“We feel we have an advantage in terms of quality, customer service in the aftermarket and a secure SPACETALK app, which really appeals to the UK market.

SPACETALK solutions

“UK parents face the same social issues with kids access to mobile devices and cyber bullying that we face in Australia.

“SPACETALK has the solution to keeping busy parents in touch with children without the need of a mobile smart-phone with access to all kinds of social media and the Internet.”

The company will make further announcements about UK retail partners over the coming months.

SPACETALK is available in JB HiFi and leading-edge stores in Australia and through Spark’s retail store network in New Zealand.

Carlton is in the same 770-hectare mining lease application area as Core’s Grants deposit and is only a few hundred metres of the company’s proposed mine and processing facility.

Core's Finnis project and its proposed Grants mine in the Northern Territory

Grants forms part of the Finniss project and Core plans to develop the 117-hectare Grants resource as an open cut lithium mine targeting a pegmatite deposit containing the lithium-bearing ore spodumene.

Regulatory approvals are being sought from the NT Government and funds sought from financiers as the company seeks to open the mine by the end of 2019.

Core managing director Stephen Biggins reported in December 2018: “The global mineral resource for the Finniss project has increased rapidly from 1.8 million tonnes at the start of 2018 to 7.1 million tonnes at year end.

“Core’s management is of the view that the global mineral resource will grow even further in January, given the quality of the drilling results received from the recent exploration drilling at Hang Gong and Lees-Booths Link.

“These new mineral resources have the potential to add substantial upside to the economics of the Finniss Lithium Project, in addition to the lithium mineral resources already defined.”

Significant potential to expand the mineralisation has been identified during the Lees-Booths Link and Hang resource estimation process.

Highlights from the results included 6 metres at 1.49% from 146 metres at Hang Gong and 13 metres at 1.46% from 193 metres at Lees prospect.

A drill hole plan for the BP33 deposit at Finniss project

Capital position

Core increased its number of shares by 12 million shares to 693,866,657 on January 16, 2019, after issuing its $3 million of placement shares priced at 5 cents each.

The share issue was a 1.76% dilution of voting power for the company’s investors.

Core advised in its annual report there were 633,591,657 shares on issue and 2,786 shareholders on August 31, 2018.

The company’s top 20 shareholders had 24.56% of the company.

Among the investors were top shareholder Ya Hua International Investment and Development Co Ltd with a 9.44% major stake, and a number of other smaller holders, including then number two largest shareholder Mining Value Fund Pty Ltd (1.58%) and joint number three George Chien Hsun Lu and Jenny Chin Pao Lu (1.28%).

The company had $5.5 million cash on September 30 after spending $2.5 million on its operating activities.

It subsequently received $3 million in commitments from sophisticated investors in December 2018, issuing the new shares in January 2019.

“The Yarrie project is three tenements which are all historic mining operations from the early 1920s [and] there’s been little to no work done on these projects in the last two decades,” Schofield says.

He continues, “we started drilling at Yarrie in January last year and followed that up with a drill program in December.

“We’ve come up with some intersects that are very appealing, for instance 8 metres at 18 grams, of which 4 metres was at 40 grams – so some significant results that indicate we actually may be able to bring a resource up around this project.”

“We’re seeing a shift in the way that we store and then discharge energy and the uptake in the electric vehicle space and improvements in battery technology have been impressive,” Prentice says.

He continues, “but I think in the medium to long-term, the hydrocarbon story is really about global growth and consumption and the outlook looks strong … from the petrochemical sector all the way through to the fuel sector.

“We’ll continue to focus on increasing our landholding but also increasing our reserves – ultimately that will be the factor that unlocks the value that’s already built into the business.”

]]>Thu, 17 Jan 2019 17:38:00 +1100Brookside Energy Ltd "looking forward to an exciting 2019", says MD David Prenticehttps://www.proactiveinvestors.com.au/companies/news/212822/brookside-energy-ltd---looking-forward-to-an-exciting-2019--says-md-david-prentice-212822.html
https://www.proactiveinvestors.com.au/companies/news/212822/brookside-energy-ltd---looking-forward-to-an-exciting-2019--says-md-david-prentice-212822.htmlBrookside Energy Ltd (ASX:BRK) managing director David Prentice has acknowledged that volatility is a part of life, telling investors the company can plan for and manage share price volatility.

The corporate leader and long-time resources industry executive answered shareholders’ questions in an interview with Proactive Investors published today.

Prentice said price action had affected business sentiment but it had not affected Brookside’s fundamentals.

Prentice told Proactive Investors’ Stocktube video channel the company was “looking forward to an exciting 2019”.

Brookside’s strategic goal is to build value through a disciplined portfolio approach to the acquisition and development of producing oil & gas assets, and the leasing and development of acreage opportunities.

The Western Australian company declared maiden reserves of 3.45 million barrels of oil equivalent (MMboe) in December 2018 for its acreage in the USA’s prolific Anadarko Basin.

The combined net present value (NPV10) of this reserve is US$12.5 million at a 10% discount, with forecast future net revenues of US$37.75 million.

The NPV10 per acre of about US$30,000 is testament to the strength of Brookside’s business model.

Subiaco-based Brookside’s maiden net oil & gas reserves were attributable to only 20% of its total holdings in the basin, so the company is confident of growing its total from the remaining 80% ground.

The company’s 2018 maiden reserve came at a time of volatility in financial markets.

Prentice said: “2018 generally was a pretty good year for oil & gas prices.

“Crude oil averaged around US$60 a barrel for 2018 and natural gas around $3.

“Obviously we saw some pretty dramatic volatility towards the end of the year, the oil price was off dramatically and gas natural prices were up dramatically.

“So, yes there was some volatility. This volatility obviously affects sentiment but it really does not impact on our business model, on our fundamentals or how we execute our business plan.”

Prentice, who is also chairman of Lustrum Minerals Limited, told Proactive the business fundamentals for Anadarko remained strong and the American basin was a great place to execute the company’s business plan.

Brookside’s proven reserves in Anadarko Basin were estimated at 2.83 MMboe, or about 82% of total reserves.

A further 0.617 MMboe were in the probable reserve category.

Bearish markets have advantages

Brookside has a strategy to pick up new projects and new ground when markets conditions soften.

Prentice said: “Long-term price fluctuations like we saw from the middle of 2014 to the middle of 2016 obviously do provide opportunities, that’s where you’d like to execute what we like to call the buy-low strategy.

“Whereas, what I would consider the short-term-type price fluctuations that we’re seeing now probably don’t have an impact on our business model.”

The managing director has noted improvements in the Anadarko Basin area, highlighting activity had increased along with acreage prices, production and reserves.

Hydrocarbons have a future despite electric vehicle fervour

Prentice believes the company’s portfolio and approach will help Brookside build long-term value for investors.

“I think the future’s bright for oil & gas.”

Prentice told Proactive he believed a bright future for hydrocarbons was fundamentally linked to global growth and consumption for the full spectrum of energy sources.

Prentice said: “I’m obviously an oil & gas bull, worked in the industry a long time and it’s something I’m quite passionate about.

“Certainly we’re seeing a shift in the way that we store and then discharge energy, and the uptake of the EVs (electric vehicles) space.

“Improvements in battery technologies have been impressive.”

The resource industry figure of more than 25 years has 15 years experience leading companies, including Red Fork Energy Limited and DLA Phillips Fox.

Prentice is confident of the medium to long-term outlook for oil & gas.

“I think … in the medium to long term, the oil price, or the hydrocarbon story, is really about global growth and consumption.

“The outlook looks strong across the spectrum, all the way from the petrochemicals sector through to the fuels sector.

“I remain a bull and I still think this is the right place for our shareholders to be.”

A standout approach

Prentice believes Brookside stands out from its peers and competitors with its strategy for tenement acquisition.

He told Stocktube: “We’re passionate about this land and leasing model that I (outline) when I’m on your program talking about our strategy.

“We still believe that it is absolutely the best place for Aussie investors in the oil & gas sector — in the US to get the best returns, the best leverage — and so we remain committed to that land and leasing strategy.”

Prentice told Proactive he was passionate that part of the business would generate the best returns for Brookside’s shareholders in the long term.

— with Danielle Doporto, John Miller

Q&A with David Prentice

1. What factors make the company a promising investment proposition?

If we take out the things we can’t control — price volatility, as an example — and focus on fundamentals, it’s our ability to grow reserves and increase dollars per acre that makes us a compelling investment.

2. What fundamental factors are required for a re-rating for the company?

It’s all about reserve growth — 2019 will be a transformational year for us as we kick-off development of our SWISH area in the SCOOP Play.

3. How is the company travelling financially?

We are traveling well. A key benefit of our business model is the flexibility to shift capital from one area to another as we high-grade our portfolio. Also, our ability to source capital from external sources to fund drilling and reserve delineation is key.

4. Why the focus on the Anadarko Basin rather than other oil & gas regions in the world?

We identified the opportunity in the Anadarko Basin early and the basin continues to get better. We love the basin metrics, geology and reserve potential, and access to services and infrastructure and premium markets for the oil & gas. The Anadarko is now widely recognised as one of the lowest break-even-price basins on-shore in the US. Break-even is from the high US$20s to the low US$40s a barrel.

5. What are the upcoming catalysts for the company in 2019?

Following a strong performance in 2018 at the asset level and the release of our maiden reserve report (US$12.5 million NPV for 20% of our holdings), we are looking forward to scaling up in 2019 with the chance to increase our acreage and reserves by multiples as we take larger working interests across a bigger acreage position. In the short-term milestones will be centred on success with our spacing and pooling activity in SWISH.

]]>Thu, 17 Jan 2019 17:00:00 +1100Cobalt set for bearish 2019 but demand fundamentals remain stronghttps://www.proactiveinvestors.com.au/companies/news/212832/cobalt-set-for-bearish-2019-but-demand-fundamentals-remain-strong-212832.html
https://www.proactiveinvestors.com.au/companies/news/212832/cobalt-set-for-bearish-2019-but-demand-fundamentals-remain-strong-212832.html
Following strong upwards trends in 2017, the cobalt price in 2018 climbed to reach an all-time high of US$95,250 a tonne in March before plummeting more than 50% by year-end.

The market volatility across the year was shared by most other base metals, fuelled by the US-China trade dispute as well as China’s contracting economy.

Market sentiment for cobalt shifted further due to announcements from major battery makers such as Tesla to decrease the amount of cobalt to be used in their batteries.

It was also affected by a supply-side response in the form of larger artisanal production from the Democratic Republic of Congo (DRC), which put medium-term pressure on prices.

Six-year cobalt price. Source: tradingeconomics.com

Strong demand fundamentals

Production from the DRC has added to volatility due to considerations of ethically-sourced cobalt and the country’s recent contested elections.

Nonetheless cobalt demand remains strong and its use in lithium-ion batteries will potentially triple by 2026.

This was given a jump-start late last year when Katanga Mining (TSX:KAT) halted export sales at its Kamoto mine in the DRC after identifying uranium in its cobalt production.

Cobalt demand increased at a rate of 8% per year from 2010-2017, according to Roskill, mainly driven by demand from the battery sector which now accounts for more than half of total cobalt consumption.

Demand for cobalt in batteries is predicted to grow at 14.5% a year to 2027, which, coupled with increases in other end-uses such as nickel alloys used in aerospace, paint a rosy picture for cobalt outlook across the next decade.

‘Demand will continue to grow’

The 2018 price correction was expected by some analysts, with Benchmark Mineral Intelligence analyst Casper Rawles noting he had anticipated the market to correct but was somewhat surprised by how much.

Rawles said: “There were some exceptions to the rule, but from the end of quarter one and throughout 2018, we’ve seen prices decreasing and continuing to fall.”

Explaining the downward trend, Rawles pointed to the increase in the price basis of raw material feedstocks from the DRC going into China and the resulting credit availability and cash flowing in China.

He remained cautious looking ahead, saying “demand will continue to grow, consumption of lithium-ion batteries is going to grow, but as of right now there’s enough cobalt around to meet the needs of the market”.

Rawles expects the recent election uncertainty in the DRC to potentially have small supply disruptions but these would be short-lived and have no impact on prices.

Advanced technology applications

Most cobalt is mined as a by-product of copper or nickel and is reliant on the strength of those markets.

The US Geological Survey estimates that 43% of world cobalt production in 2015 was from copper mining and 44% from nickel.

There is only one modern primary cobalt operation, the Bou-Azzer mine in Morocco, but that only contributes around 2% to global production.

Cobalt is useful in the manufacture of varying products due to its ferromagnetism and wear-resistance when alloyed with other metals.

The transition metal retains its magnetism at high temperatures and can be used in advanced technology applications as well as in superalloys and as a refining catalyst.

Diversification of supply sources

More than 60% of the world’s cobalt production comes from the DRC, of which 10-25% is estimated to be artisanal in nature.

According to the US Geological Survey, total global cobalt production in 2017 was 110,000 tonnes, down from 111,000 tonnes the previous year.

The DRC contributed 64,000 tonnes in 2017 with Russia in second place at 5,600 tonnes.

Australia and Canada, the third and fourth highest producers respectively, have had added interest as cobalt jurisdictions due to stable mining codes, established supply chains and promising cobalt developments.

The global hybrid and electric vehicle market grew by 33.2% in 2017, according to MarketLine data, and demand is predicted to keep rising through 2020.

This could potentially create substantial shortages in cobalt as early as 2022 with current production estimates.

A number of companies are actively developing cobalt projects in Australia and Canada which may soon begin contributing to global production if demand predictions and supply-side challenges persist.

Chinese contraction causes medium-term price weakness

Data shows China’s gross domestic product (GDP) has decreased for the past five consecutive quarters and the country’s leader Xi Jinping has remained vague on Beijing’s plans for a wider economic stimulus.

In terms of both supply and consumption China is a key market for base metals and its economic growth has a strong impact on prices and market sentiment.

According to Darton Commodities, China accounts for more than 80% of the production of cobalt chemicals and it remains a key producer of batteries.

Overall 2018 GDP growth for China is anticipated to be 6.6% and it is expected that the Chinese government will lower its economic growth target to 6%-6.5% in a March parliamentary session.

Forecasts from the International Monetary Fund for world GDP growth are 3.7% for both 2018 and 2019, including slower growth for the US and China at 2.5% and 6.2%, respectively.

Trade dispute foments uncertainty

Talks between the US and China are ongoing and have assuaged some investor concern, but until the dispute is concretely resolved the market uncertainty will persist.

According to Fastmarkets MB Research, China is planning new incentives to boost domestic consumption for goods associated with metal demand including auto and home appliances.

Along with any further economic stimulus, the measures could spark a brief recovery in metals prices but would need an established trade deal to sustain upwards price pressure.

Scotiabank analysts reported in mid-October that the global trade dispute was not only the primary driver of the base metals slump but that also it would continue to have an affect up to 2020 and potentially beyond.

Scotiabank said: “US-China trade concerns remain front-and-centre for commodity markets with no obvious end in sight.

“We now believe that the US-China trade dispute will remain a slow-burn drag on industrial commodity sentiment through to the 2020 US presidential election.”

The Scotiabank analysts pointed out that prices were down despite falls in base metal stockpiles, with nickel inventories at five-year lows and copper down 50% over the last six months.

Cobalt driven by Chinese consumption

With demand sustained from downstream manufacturing sectors producing smartphones and electric vehicles, and supply primarily constrained to the volatile DRC, cobalt prices are likely to remain strong in future.

China imports 99.3% of the DRC's cobalt exports, making it the world's largest cobalt importer at 38% of global imports.

In order to secure stable supply, Chinese state-owned enterprises are increasingly investing in cobalt production in the DRC, with Bloomberg noting eight of the fourteen cobalt mines in the DRC are Chinese-owned.

The largest example is China Molybdenum which is now the world's second largest cobalt producer behind Glencore.

Limited corporate social responsibility and a lack of awareness of local supply chains have given Chinese enterprises an advantage in securing products for its cobalt refining and chemical industry.

Cobalt producers will need to produce more than 200,000 tonnes of cobalt in battery-grade chemicals a year by 2028, according to Benchmark, pushing total demand to 250,000-300,000 tonnes including consumption in other products.

Global cobalt resources by jurisdiction. Source: United States Geological Survey

Defining new cobalt jurisdictions

While the DRC is expected to remain the world’s primary supplier of cobalt in the foreseeable future, the issues plaguing the mining industry in the central African country have prompted a spike in exploration for cobalt in other jurisdictions.

A number of Australian cobalt and battery metal developers are advancing work on projects both at home and abroad, aiming to define and extract economic cobalt resources.

Corazon Mining Ltd(ASX:CZN) aims to define a large deposit at the Cobalt Ridge prospect within its Mt Gilmore Cobalt-Copper-Gold project in northeast NSW.

The company is also developing the Lynn Lake Nickel-Copper-Cobalt Sulphide Project in Canada.

Drilling at Cobalt Ridge included 5 metres at 2.14% cobalt within a broader intersection of 27 metres at 0.47% cobalt from 49 metres.

Results from a geochemical soil sampling program which ended in November indicated cobalt and copper values of up to 450 ppm and 1,060 ppm, respectively, and rock chip samples have graded up to 1,795 ppm cobalt and 16.3% copper.

READ: Fe Limited advances copper-cobalt in DRC and is leveraged to highly prospective ground in WA

Fe Limited(ASX:FEL) is advancing its Kasombo Cobalt-Copper Project in the DRC towards production in the first quarter of 2020.

Kasombo is 25 kilometres from the DRC’s second largest city, Lubumbashi, in the Katanga Copper Belt.

The fully-underwritten loan facility led by African development financial institutions (DFIs) African Export-Import Bank and Africa Finance Corporation has a series of milestones Danakali must satisfy to qualify.

“A project like this, it needs a team. It needs a team inside Danakali, but it needs a team of partners to give it the best possible outcome, and that’s what we’ve got now.”

Colluli is 100% owned by the Colluli Mining Share Company (CMSC), a 50:50 joint venture between Danakali and ENAMCO.

CSMC has a binding offtake agreement with EuroChem for up to 100% (minimum 87%) of module I sulphate of potash (SOP) production from Colluli.

A number of debt milestones remain for the company that is focused on development of its asset in a country now at peace with its neighbour, Ethiopia.

Cornelius told Proactive Investors the company was at an exciting phase.

“Where we are in terms of the project, is we are shovel-ready.

“As soon as we secure the full funding we will start construction — the construction will take two years and then we’ll be in production [in] 2021.”

A changed environment

The UN lifted sanctions on Eritrea in November, changing the country’s investment environment.

Cornelius said: “Lifting of the sanctions is unquestionably a very positive thing.

“The sanctions were never specifically impacting us but as you can imagine, the general atmosphere was negatively affected by the fact of the sanctions.”

Colluli quality

The executive chairman outlined the features of the Eritrean asset Colluli in his Stocktube interview.

Cornelius said: “Colluli is a potassium asset, it’s in the Danakil Depression which is a giant, natural geological feature.

“Colluli is a very shallow potassium deposit very close to the coast.”

The deposit is amenable to simple, low-cost open-cut mining with a progressive working face to provide simultaneous access to each mineralised layer.

It has been declared the shallowest evaporite deposit in the world, with mineralisation starting at just 16 metres, allowing open-cut mining.

Cornelius also spoke about the proposed mine and ore gradings, saying “Once (the mine) opens up at the very beginning, we’ll be producing 472,000 tonnes of potassium sulphate, which is a particular kind of potash.

“It is the high-value, high-grade kind that is inshort supply, so we’re very happy with that.”

Milestone focus

Danakali’s remaining debt milestones include finalising contracts with a number of parties, including the company’s preferred engineering, procurement, construction and management (EPCM) provider DRA Global.

EMA is the European equivalent to the Australian TGA and the US FDA. As part of the registration, this allows MDC to apply for scientific advice, drug evaluation and registration of NanaBis.

It also provides MDC with the opportunity to obtain fee reductions up to 90% in the process.

NanaBi is a cannabis-based medicine which contains formulations of tetrahydrocannabinol (THC) and cannabidiol (CBD).

Medlab chief executive officer Dr Sean Hall said: “This is a significant milestone for MDC. Drug registration of NanaBi is key part of the company’s plans and this qualification allows us to start the process into Europe.

“Drug evaluation and registration fees with the various agencies are expensive, but at the same time, a much needed and real cost in bringing a drug to market and we welcome the opportunity obtain fee reductions and as a result significant savings.

“Personally, I would like to thank EMA for their collaborative approach in this regard, and very much look forward to escalating the NanaBis evaluation with EMA as we move closer to an approved drug in the EU.”

Earlier this week the WA explorer announced new assay results from the Lake Austin North discovery of the Cue Gold Project.

The broad gold intersections of up to 137.2 metres at 0.6 g/t from 97.8 metres, including 20.2 metres at 2.3 g/t from 194 metres, have extended mineralisation at the A-Zone.

Phase II drilling underway

A phase II diamond drilling program of a minimum of 15 drill holes for about 4,000 metres is underway with first assay results expected in late February.

Musgrave will also begin regional aircore drilling this week aimed at defining the extents of the A-Zone and C-Zone mineralisation to enable accurate diamond drill targeting along strike.

This program will also include preliminary first pass testing of new lake gold targets.

Aircore drilling is also underway to test three new gold targets on Cue’s northern tenure including the Vostock target, which is only 2 kilometres east of Westgold Resources Ltd’s (ASX:WGZ) Comet mine.

This week Waugh has also discussed the company progress at Cue, its raising of $5.5 million in a placement and the gold outlook in an interview with Proactive Investors’ Stocktube.

Parsons also discusses the company's cash position, upcoming quarterly, and acknowledgement in a recent Macquarie Bank Global research note as a top pick for its gold exploration potential.

]]>Thu, 17 Jan 2019 15:59:00 +1100Pharmaxis LOXL2 program phase 2 ready after completion of 13-week toxicity studieshttps://www.proactiveinvestors.com.au/companies/news/212738/pharmaxis-loxl2-program-phase-2-ready-after-completion-of-13-week-toxicity-studies-212738.html
https://www.proactiveinvestors.com.au/companies/news/212738/pharmaxis-loxl2-program-phase-2-ready-after-completion-of-13-week-toxicity-studies-212738.htmlPharmaxis Ltd (ASX:PXS) has now received reports on all of the 13‐week toxicity studies conducted for each of its two Lysyl Oxidase Like 2 (LOXL2) inhibitors.

The company is now ready to enter phase 2 clinical studies for fibrotic diseases such as non‐alcoholic steatohepatitis (NASH), cardiac fibrosis and idiopathic pulmonary fibrosis (IPF).

Adequate safety margin to start phase 2 studies

Both the drug compounds were tested at a range of doses in two species over a 13‐week period to establish the No Observed Adverse Effect Level (NOAEL).

For both compounds, doses that resulted in 85% or greater inhibition of the target enzyme in the phase 1 studies were below the human equivalent NOAEL doses in all toxicity studies and therefore an adequate safety margin to start phase 2 studies of up to three months in length.

With the data package complete, Pharmaxis is now conducting a final series of scientific briefings to potential partners.

“We have provided the large pharma companies who have been closely monitoring our progress with the latest study results and are now in the process of supporting them to complete their scientific due diligence.

“We are keen to answer remaining scientific questions of potential partners, discuss their proposed clinical development strategies should they acquire or license the program and progress discussions concerning appropriate commercial terms.”

Pharmaxis’ LOXL2 program compounds are highly selective small molecule inhibitors of LOXL2 that can be administered orally and the completed pre‐clinical development program supports the potential of both compounds to treat fibrotic disease in one or more organs.